The idea most likely to rattle America’s Big 3 wireless carriers has nothing to do with orbit. It starts with a cellular base station strapped to a Starlink dish sitting on someone’s rooftop.
SpaceX is gearing up to build a ground-based mobile network, and the stated purpose is to pull subscribers away from T-Mobile, AT&T and Verizon. That came directly from SpaceX president Gwynne Shotwell and CEO Elon Musk, speaking during the Q&A segment of the company’s first-ever earnings call.
“I anticipate us to be able to acquire quite a few of their customers because I think our service will be better,” Shotwell said.
EchoStar’s spectrum comes with a ground component — and SpaceX intends to use it
“The spectrum that we purchased from EchoStar does have terrestrial components, so we definitely intend to build out the terrestrial component,” Shotwell said. “You will have not only the capacity from the satellites themselves, but you will have a buildout of the terrestrial, basically the hardware and systems necessary to make a true mobile service exactly what you want it to be.”
That is a departure from the business SpaceX operates now. Starlink Mobile, its current direct-to-device offering, works as an add-on to carrier networks instead of a substitute for one. Inside the US it piggybacks on T-Mobile, delivering limited texting and data whenever you wander into a cellular dead zone.
According to Shotwell, the offering will become “100 times better” once it taps the bandwidth bought from EchoStar together with next-generation Starlink Mobile (V2) satellites that “will start flying next year.”
Sixty-five megahertz is not a national network
Then comes the piece ambition alone cannot fix. The EchoStar deal gave SpaceX just 65 megahertz of spectrum — a fraction of what each of the Big 3 controls in the US.
Blanketing the country therefore means buying more spectrum or inventing an alternative. Shotwell hinted at “great and new ideas” for assembling a ground network cheaply, then more or less revealed the blueprint.
“Let me give a little hint. And that is you could put a base station, a cellular base station on the gear that holds a Starlink broadband dish. So you can have kind of these little femtocells around the country, and you deploy that as you need it.”
Musk’s framing: forget the towers altogether
Musk stepped in to drive the point home.
“Yeah, that point is probably worth just a few more words, because this is quite an important point. Instead of having to deploy these very expensive and difficult to locate, large cellular base stations, we feel reasonably confident that we can deploy a large number of small stations. Essentially, they’re really just Starlink dishes that also provide connectivity in the mobile spectrum bands, and have them be all over the place.”
And he continued. “The Starlink antennas are located on the roofs of houses and businesses, so they’ve got sort of a clear view for providing connectivity directly to cellphones on the ground. Providing connectivity, that is, we think, probably better and higher bandwidth than what is currently available from cellular providers. This is an important point.”
The qualifiers are worth catching. “Reasonably confident.” “We think, probably better.” Musk is not saying the network is here. His claim is that the company believes it can be assembled without the tower-siting battles and permitting grind that shape carrier rollouts. Those are separate propositions, and it is the latter that has sunk every aspiring fourth carrier the US has seen.
The figure on Shotwell’s mind is $600 billion
By Shotwell’s estimate, the US wireless market — ruled by AT&T, T-Mobile and Verizon — generates roughly $600 billion a year. SpaceX is after a piece of that.
For anyone tracking the lead-up to the company’s IPO, none of this lands as a shock. Those larger ambitions were already circulating, with Shotwell telling investors the company planned to sell mobile contracts straight to individual US consumers.
The difference now is that the plan is on the record, delivered on an earnings call, and pointed by name at the three companies collecting your bill each month.
T-Mobile subscribers are, in a small way, already customers of this vision. That dead-zone texting on your handset is SpaceX’s foot in the door — and the company has just informed investors it plans to push all the way through and sell you the entire plan.